2021 was a boring year for mainstream cryptocurrencies. Bitcoin and Ethereum saw some gains, but nothing compared to their long-term historical average. Instead, the world adopted Non-Fungible Tokens (NFTs), DeFI products and play-to-earn games in 2021.
Now, new trends have emerged that could play out in 2022 and push some crypto tokens higher. Here are the top three crypto tokens that should be on your radar in the new year.
Online searches for the term “metaverse” have soared every since Facebook changed its corporate name and revealed its new business strategy. Mark Zuckerberg has rarely been wrong about tech megatrends in the past. His bet on messaging apps and photo-sharing social networks were early and incredibly lucrative. Now, his bet on virtual reality and the metaverse could be another game-changer.
Investors see a role for crypto tokens and digital assets in this emerging field. They’ve poured millions into buying virtual plots of land on blockchain-based metaverse platforms in recent months. Much of that capital has been targetted at Decentraland – which is now one of the largest metaverse crypto projects in the sector. Institutional investor Grayscale launched its Decentraland Trust while a Canadian investment firm purchased a parcel of land worth $2.5 million within the virtual world recently.
As this trend continues, Decentraland could become one of the most noteworthy projects of the year.
Blockchain-based game Axie Infinity is yet another metaverse play. Investors can acquire plots of land and characters within the dApp. But Axie is noteworthy for another reason – its play-to-earn model.
Last year, the platform gained immense traction as users in the developing world realized they could generate more income from the game than their local economy. Since then, the average income an Axie player can expect has declined. 2022 is a make-or-break year for this model. If the team can sustain its current pace of growth and add new income-generating elements to the gameplay, AXS could become one of the most popular digital assets in the industry.
South Korea-based Terraform Labs created a platform that facilitates blockchain-based e-commerce. Three years later, the Terra Luna platform has evolved far beyond e-commerce and is now a hub for open Decentralized Finance products. Their flagship product is the Terra USD or UST – which is quickly becoming one of the most popular stablecoins in the industry.
Meanwhile, investors have locked up assets worth $20 billion on DeFi protocols created on Terra Luna. Unsurprisingly, the LUNA token has had a great run. In 2022, this run could be extended as more people adopt DeFi products and investment opportunities.
Special mention – Ethereum
Ethereum deserves a spot on this list because of recent comments from co-founder Vitalik Buterin. Buterin said the platform’s development had reached 50% of its “grand vision.” This could exceed 80% as the Merge is completed in mid-2022. The Merge will fully migrate the network to Proof-of-Stake – which drastically reduces Ethereum’s energy footprint and improves the network’s utility for investors seeking passive income.
2022 is shaping up to be an interesting year for metaverse, play-to-earn, and DeFi protocols.